ION EXCHANGE (INDIA) LTD. versus UNION OF INDIA AND ORS.

Citation: [1998] SUPP. 2 S.C.R. 560 · Decided: 06-11-1998 · Supreme Court of India · Bench: S.P. BHARUCHA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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B 
ION EXCHANGE (INDIA) LTD. 
v. 
UNION OF INDIA AND ORS. 
NOVEMBER 6, 1998 
[S.P. BHARUCHA, K. VENKATASWAMI AND A.P MISRA, JJ.] 
Monopolies and Restrictive Trade Practices Act, 1969, Section 36-~ 
Unfair Trade Practices-Commission's power to issue Cease had Desist 
Orders-Scope of-Director General of Investigation and Registration 
C instituting an inquiry of unfair trade practice against the appellant over an 
advertisement issued by it-Not contested by the appellant-Cease and Desist 
order passed by Commission subject to a condition that future advertisement 
to be issued by the appellant after prior approval by the Commission-Held, 
Commission not empowered to issue such direction-Commission has ample 
D power under the Act to deal with persons who violate its Cease and Desist 
order. 
The appellant, manufacturer of water purifier, issued advertisement 
that its water purifiers provided 100% safe drinking water instantly and 
that the water stayed bacteria free in storage. An enquiry was instituted by 
E the Monopolies and Restrictive Trade Practices Commission at the behest 
of its Director General of Investigation and Registration. Appellant did not 
contest the allegation made in the Notice of Enquiry and submitted to a 
Cease and Desist Order. However, the Commission passed such an order 
subject to the condition that any future advertisement would be subject to 
approval by the Commission. Appellant challenged this part of the order 
before High Court in a writ petition. High Court dismissed the writ petition 
on the ground that Commission had given the said direction to subserve 
the object of effectively checking repetition of the unfair trade practice 
affecting a large number of people. Hence this appeal. 
It was contended by the appellant that both un-amended as well as 
amended Section 36-B of the Act did not confer on the Commission to issue 
such direction; that however, the Commission had ample power to deal with 
any infraction of its Cease and Desist Orders. 
Allowing the appeal, this Court 
HELD: Both un-amended and amended provision of Section 36-D of 
560 
ION EXCHANGE (INDIA) LTD. v. U.0.1. [BHARUCHA, J.] 
561 
the Monopolies and Restrictif! Trade Practices Act cannot be so read as A 
enabling the Commission to require all advertisements that the appellant 
might issue in the future to be approved by the Commission in advance. 
The requirement to disclose information relates only to the unfair trade 
practice then undei: inquiry. As to public interest, the Commission is 
sufficiently armed under the Act with powers to take action against those B 
who breach its Cease and Desist Orders. It does not require the additional 
· power ofsupervision of the kind indicated either in the impugned direction 
of the Commission or in the order under challenge to effectively carry out 
its obligations. The Commission cannot incorporate such direction in its final 
Cease and Desist Orders. [563-E-F) 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5517 of C 
1998. 
From the Judgment and Order dated 4.8.98 of the Bombay High Court 
in W.P. No. 2793 of 1988. 
A.M. Setalvad, Gaurav Joshi, Marco Wadia, Mahesh Agarwal and E.C. D 
Agrawala for the Appellant. 
K.N. Rawat, Additional Solicitor General, and Ashok K. Srivastava and 
P. Parmeswaran for the Respondents. 
The Judgment of the Court was delivered by 
BHARUCHA, J. Leave granted. 
The appellant manufactures water purifiers. It issued advertisements 
stating that these water purifiers provided 100% safe drinking water instantly 
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and that the water stayed bacteria free in storage. An enquiry was instituted p 
by the Monopolies and Restrictive Trade Practices Commission at the behest 
of its Director General of Investigation and Registration. A Notice of Enquiry-
was issued to the appellant. At the hearing ther'ilof the appellant did not 
contest the allegation made in the Notice of Enquiry and expressed willingness 
on the very first date of hearing before the Commission to submit to a Cease 
atid Desist Order, which was passed. What is objected to on behalf of the G 
appellant is this further direction of the Commission : "If the respondent 
wants to issue an advertisement in future about its product, it will get a draft 
of its advertisement approved by the Commission." 
Impugning the power of the Commission to issue such further direction, 
the appellant filed a writ petition in the High Court at Bombay. The High H 
562 
SUPREME COURT REPORTS (1998] SU
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